(Bloomberg) -- The success of Novo Nordisk A/S and other Danish drugmakers abroad prompted the country’s central bank to raise its economic growth forecast through 2025.

Gross domestic product will probably expand 1.7% in 2023, up from a March estimate of 0.9%, the central bank said on Wednesday. The Danish economy is then set to grow by 1.3% in both 2024 and 2025, versus the previous forecast of 1.2%.

Economic growth is “surprisingly strong,” the central bank said, though it hinted that figures may be skewed by activities taking place outside of Denmark, especially within the pharmaceutical industry. Expansion “seems to be driven by production in a very small segment of the economy, largely taking place abroad under Danish ownership,” it said.

The drug industry in Denmark, dominated by Novo Nordisk, is estimated to make up about 5% of the Danish economy. The company, which has become Europe’s most valuable, last month upgraded its profit outlook for 2023 fueled by demand for its new weight-loss drug Wegovy, especially in the US.

Read More: Novo Nordisk’s Growth Camouflages Weak Spots in Danish Economy

Foreign subcontractors to Novo and its local peers are included in the nation’s exports and value added because production takes place under Danish ownership, the central bank said. They are as such helping to drive up the country’s output.

Governor Christian Kettel Thomsen told reporters in Copenhagen “growth would be quite weak in the coming years” without the contribution from producers of medicines.

In the Danish government’s latest review of the economy, released last month, it mentioned Novo Nordisk 31 times. This is unusual, but necessary given the company’s size and recent developments, Economy Minister Jakob Ellemann-Jensen said at the time. The Danish government also lifted its growth forecast in August, saying it expects 1.2% growth this year.

Latest GDP figures show that the economy expanded 1.7% in the first half of 2023 compared with the year-earlier period, but would have contracted by 0.3% in that time without the pharmaceutical industry’s contribution.

The central bank projects that house prices will drop by 3.2% in 2023, less than the 9.4% decline anticipated in March. Meanwhile, the inflation rate is expected to land at 3.8% this year, lower than 4% seen before.

(Updates throughout with details, governor comments.)

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